Palm Springs City Council voted Sept. 10 to approve staff's draft response to a June 23 Riverside County Civil Grand Jury report that criticized the city's vetting and monitoring of grant-funded pilot programs.

The council's draft response says the city disagrees with the grand jury's finding that “inadequate oversight resulted in a loss of over $700,000,” noting that DAP Health completed the pilot program and that staff could not reconcile a specific loss amount because financial statements from contractors were not provided for audit. The response also sets out how the city will address the report's recommendations going forward.

Why it matters: the grand jury report focused public attention on how the city paid and monitored grant contractors, and several public speakers urged the council to acknowledge a specific dollar loss and to strengthen transparency. Residents told the council they believed donors to DAP Health diverted funds intended for patient care to cover gaps in payments arising from the project reviewed by the grand jury.

Council and staff said the response is intended to satisfy state law, which requires the city to say whether it agrees or disagrees with findings and to list a plan and timetable for implementing or declining each recommendation. Christopher Muni, the city's finance director, told the council staff was unable to confirm exact amounts because the city lacked the documented financial statements it would need to reconcile expenditures.

Public commenters pressed for stronger language acknowledging taxpayer loss. Ginny Folk told the council she found the draft response “not honest and transparent” because it states the city disagrees with the finding but does not identify which portion it disputes. Philip Hodges urged the council to acknowledge that donors to DAP Health had to “bail out City Hall” and asked that the city plainly acknowledge responsibility for the $700,000 alleged loss in the public record.

Council members discussed whether the response could more precisely identify which parts of the grand jury's findings the city disputes; staff and the city attorney advised that council may specify disputed portions in its written response. Council directed staff to proceed with the draft response, noting it can be edited before the state deadline. The response must be filed under state law within 90 days of the grand jury report; staff said the due date is Sept. 24.

Ending: Council members also asked the city manager to return with a plan to institutionalize periodic policy reviews so the city can better track and update procedures that affect grant management and other municipal programs.